Gov't Yet to Empower New Hotel Legislation

Friday, 17 July 2009 06:35
Lisa Wells

It's unclear what if any new resources the Ministry of Tourism will throw at its Hotel Licensing Unit in an effort to bring as many as 1,000 second homeowners — now treating their properties like hotels — into compliance with the new law. In fact, the department's head tells Guardian Business the government will be largely dependent on the honesty of those proprietors to win what could be millions of dollars in revenue.

"This is a fairly new venture for us," Monique Hepburn told Guardian Business late last month and as government ushered in amendments to hotel legislation seeking to regularize private homeowners offering four or more rooms as hotel accommodations. "We won't know the exact details until gazetting but we (at hotel licensing) will be relying in part on the honesty of those effected homeowners.

"Amendments are under review."

She was unable to speak to what if any resources are now being put in place to beef up her small Tourism unit charged with assessing properties and collecting payment of hotel guest taxes and other licensing fees. That money has long been mandatory for lodgings operators. As a group those operators have lamented the fact that second-home owners — by Hepburn's understanding as many as 2,000 — have not been made to contribute to that tax pool. Birch and others generally welcome the change in law meant to regularize those illicit hotels, which also operate outside of government inspection.

Still, there's real concern that the administration has simply failed to give teeth to the new law. That allegation springing from the absence of any new money devoted to ferreting out those second-home owners acting as hoteliers.

"It's one thing to regularize them," Jeff Birch, head of the Out Island Promotion Board, told Guardian Business last month, "but how is the government going to bring them into compliance?"

It may be as simple as mounting a public relations blitz, working from a list of second-home property owners furnished by the real property tax office and appraising them of the classification changes.

It's the kind of carrot likely to win the government only a portion of the millions in revenue given the six percent hotel guest tax, which itself is subject to future increases.

But to win majority compliance Hepburn's department will need to take on a more aggressive and, indeed, investigative role, effectively hunting down those hotel operators acting outside the law.

It would be a challenge for the small department, more use, said one Tourism insider, to bookkeeping than police work.